In 1998, two years after completing his PhD, Graeber became assistant professor at Yale University, then became associate professor.[2] In May 2005, the Yale Anthropology department decided not to renew Graeber's contract, preventing consideration for tenure which was scheduled for 2008. Pointing to Graeber's anthropological scholarship, his supporters (including fellow anthropologists, former students and activists) claimed that the decision was politically motivated. More than 4,500 people signed petitions supporting him, and anthropologists such as Marshall Sahlins, Laura Nader, Michael Taussig, and Maurice Bloch called for Yale to rescind its decision.[2] Bloch, who had been a professor of anthropology at the London School of Economics and the Collège de France, and writer on Madagascar, made the following statement about Graeber in a letter to the university:

His writings on anthropological theory are outstanding. I consider him the best anthropological theorist of his generation from anywhere in the world.[11]

The Yale administration argued that Graeber's dismissal was in keeping with Yale's policy of granting tenure to few junior faculty (thus generating the widespread false impression that this was, in fact, a tenure case) and gave no formal explanation for its actions. Graeber has suggested that the University's decision might have been influenced by his support of a student of his who was targeted for expulsion because of her membership in GESO, Yale's graduate student union.[2][12][13][14]

In December 2005, Graeber agreed to leave the university after a one-year paid sabbatical. That spring he taught two final classes: "Introduction to Cultural Anthropology" (attended by over 200 students) and a seminar entitled "Direct Action and Radical Social Theory".[15]

On 25 May 2006, Graeber was invited to give the Malinowski Lecture at the London School of Economics. Each year, the anthropology department at the university asks an anthropologist at a relatively early stage of their career to give the Malinowski Lecture, and only invites those who are considered to have made a significant contribution to anthropological theory. Graeber's address was entitled "Beyond Power/Knowledge: an exploration of the relation of power, ignorance and stupidity".[16] This lecture has since been edited into an essay, titled "Dead zones of the imagination: On violence, bureaucracy and interpretive labor".[17] That same year, Graeber was asked to present the keynote address in the 100th anniversary Diamond Jubilee meetings of the Association of Social Anthropologists.[18] In April 2011, he presented the anthropology department's annual Distinguished Lecture at Berkeley,[19] and in May 2012 delivered the Second Annual Marilyn Strathern Lecture at Cambridge (the first was delivered by Marilyn Strathern).

The IMF (International Monetary Fund) and what they did to countries in the Global South—which is, of course, exactly the same thing bankers are starting to do at home now—is just a modern version of this old story. That is, creditors and governments saying you’re having a financial crisis, you owe money, obviously you must pay your debts. There’s no question of forgiving debts. Therefore, people are going to have to stop eating so much. The money has to be extracted from the most vulnerable members of society. Lives are destroyed; millions of people die. People would never dream of supporting such a policy until you say, "Well, they have to pay their debts."[23]

In December 2017, Graeber and his former teacher Marshall Sahlins released a collection of essays entitled "On Kings" outlining a theory, inspired by A. M. Hocart, of the origins of human sovereignty in cosmological ritual. Graeber contributed essays on the Shilluk and Merina kingdoms, and a final essay that explored what he called "the constitutive war between king and people." He is currently working on an historical work on the origins of social inequality with University College London archaeologist David Wengrow.

Much of Graeber's recent scholarship has focused on the topic of "bullshit jobs," proliferated by administrative bloat and what Graeber calls "managerial feudalism". One of the points he raises in his 2013 book The Democracy Project – on the Occupy movement – is the increase in what he calls bullshit jobs, referring to forms of employment that even those holding the jobs feel should not or do not need to exist. He sees such jobs as being typically "concentrated in professional, managerial, clerical, sales, and service workers".[25] As he explained also in an article in STRIKE! magazine:

In the year 1930, John Maynard Keynes predicted that, by century’s end, technology would have advanced sufficiently that countries like Great Britain or the United States would have achieved a 15-hour work week. There’s every reason to believe he was right. In technological terms, we are quite capable of this. And yet it didn’t happen. Instead, technology has been marshaled, if anything, to figure out ways to make us all work more. In order to achieve this, jobs have had to be created that are, effectively, pointless. Huge swathes of people, in Europe and North America in particular, spend their entire working lives performing tasks they secretly believe do not really need to be performed. The moral and spiritual damage that comes from this situation is profound. It is a scar across our collective soul. Yet virtually no one talks about it.[26]

In November 2011, Rolling Stone magazine credited Graeber with giving the Occupy Wall Street movement its theme: "We are the 99 percent" though Graeber has written in The Democracy Project that the slogan "was a collective creation".[29]Rolling Stone says Graeber helped create the first New York City General Assembly, with only 60 participants, on August 2.[30] He spent the next six weeks involved with the burgeoning movement, including facilitating general assemblies, attending working group meetings, and organizing legal and medical training and classes on nonviolent resistance. A few days after the encampment of Zuccotti Park began, he left New York for Austin, Texas.[5]

Graeber has argued that the Occupy Wall Street movement's lack of recognition of the legitimacy of either existing political institutions or the legal structure, its embrace of non-hierarchical consensus decision-making and of prefigurative politics make it a fundamentally anarchist project.[31] Comparing it to the Arab Spring, Graeber has claimed that Occupy Wall Street and other contemporary grassroots protests represent "the opening salvo in a wave of negotiations over the dissolution of the American Empire."[32]

Graeber tweeted in 2014 that he had been evicted from his family's home of over 50 years due to his involvement with Occupy Wall Street. He added that others associated with Occupy had received similar "administrative harassment".[33]

— (June 1, 2003). "The Twilight of Vanguardism". Indymedia DC. Archived from the original on January 12, 2013. Retrieved February 15, 2012. An essay originally delivered as a keynote address during the "History Matters: Social Movements Past, Present, and Future" conference at the New School for Social Research on May 3, 2003

^Graeber, David (2013). The Democracy Project. Spiegel & Grau. p. 41. ISBN978-0812993561. As a matter of historical record, since there is so much discussion of the origin of the slogan "We Are the 99 Percent," the answer is that - appropriately enough - it was a collective creation.